How do I record VAT offset from previous years in company accounts?
I am having an issue with our accounts as a result of starting to pay VAT. In the first two years of accounts we weren't paying VAT. Expenses were shown as the full amount we had paid (including VAT).
The problem comes in year three, as six months in we become VAT registered. Why the problem? Well technicaly VAT should not be showing on our P/L. So we are showing sales and expenses without VAT. The results of this should be correct as it should mirror the amount of VAT actually paid (i.e. VAT on inputs - VAT on outputs). However, the problem is that this does not take account of all the offsetting we were able to do from previous years.
In the end the offsetting from previous years was something like £8,000. How do I reflect this in the accounts? Do I show HMRC as a debtor in the previous years? I'm not sure what the normal practice would be here.
I would be so grateful for your help. Thank you
- Sage Priority Support 90 2
- Cost of demolition of a shed - revenue or capital? 682 18
- incorrect old p60 111 1
- HMRC interview re client authorisation 478 4
- VAT on new builds 112 2
- Becoming a subcontractor to Accountancy Practices 346 2
- Rental business through company without owning the property? 122 1
- Pensions Auto-Enrolment when no computer/internet access 113 1
- Bank Interest Held by Solicitor During Divorce 131 1
- Are accountants facing a doomsday scenario? 1,837 26
- Missing tax return 170 2
- Are you going to Tick and Bash on 21 May? 919 24
- CG on Spanish property disposal 276 8
- SSAS Pension scheme 162 2
- Quick Income tax calculation question! 557 18
- Physiotherapy 244 3
- Inflation and fees 1,217 20
- Capital allowances not claimed 165 3
- Changing shareholding ratio 282 8
- CGT help please 149 1